All Forum Posts by: Tobias Falzone

Sounds good to me. Would love to go

Welcome! It sounds like we have similar goals. I have yet to find a BRRR deal in the area that cash flows, but through networking my wife and I are starting our first flip out in West Sacramento that we bought through a wholesaler. The REIA meetings we have gone to so far are good. Capital City Wealth Builders is good, and I plan to attend the Roseville meeting next month. I'm happy to grab lunch sometime if you'd like.

I would advise sticking close to home. You will have more opportunity to spot value than you will several hours away. Sacramento has great opportunities, start going to REIA meetings and find out what others are doing successfully and emulate that.

I need someone to look over and renegotiate a commercial lease I'm inheriting along with a business in the Santa Rosa, California area. Can anyone recommend a person or firm the area that they have worked with successfully there or in the north Bay Area?

The complete guide to buying and selling apartment buildings by Steve berges is my recommendation for you. It is a great book with a great strategy.

It's not a crazy idea, but after crunching the numbers comparing cost of renting vs owning for me, I was saving more money "investing" my down payment on a primary residence than actually investing it in a non owner occupied property. It also simplifies financing future properties, ensures a fixed lower cost of living with the low interest rates available now, and makes sure I can actually qualify for a property in the future. I will note I did renovate and flip my first primary residence and feel that is a perfectly acceptable way to invest especially just starting out. You also get the added bonus of not paying taxes on gains as long as you live there for two years. There can be huge tax advantages buying a primary first in that way. If I had to do it over again I would house hack with a 4 plex. Best of both worlds, but I have a family now and that isn't possible for me anymore.

I general, 2% is unattainable. I've seen rates between 0.5% and 1.2% in the Sacramento metro. Where you end up on that spectrum depends a lot on the quality of the areas you are looking to buy and your general price range. There has been a lot of speculation around the downtown sac and midtown areas, which may still appreciate further. I will also note that rents have been rising and may continue to rise over time, which is another factor that buy and hold investors will take into consideration and will help the gross rent ratios 5 years out. Some of the higher end areas may be able to command better rents with updates to the units, but most areas will probably not fall into that category. If I was in your position, I would look up along the 80 between Arden and Roseville. Stocks are good there and they are generally neighborhoods I wouldn't mind living in. There are also a lot of duplexes in the Rancho Cordova area. Not a whole lot of small Multis in Folsom where I live.

What would be your strategy after acquisition for the lot in Huntsville?  Unless you have plans to develop it somehow, you have to get it really really cheap to have it make sense.

Look for a Fannie Mae low balance multi family loan. They are fixed rate with no balloon and are assumable. I doubt you can get individual release if the property is not split up yet. Ioans cannot be called at any time. If they are assumable, they will not be due on sale. I believe you can find fixed rates through a govt program for the full term of the loan or privately for 10 years, 25 amortization and balloon payment after 10. Best of luck!

Great post, but I have to point out that appreciation cannot outpace inflation and income growth forever.  That is my main concern investing in California right now as a buy and hold investor.  The higher prices go relative to general inflation and income growth, the farther they can fall in a bad economic environment.  Of course, prices could keep rising for several more years as well.  The unpredictability of appreciation make it something I can't invest in by itself.  A property needs to cash flow, that is my baseline income and will protect me during a downturn.  Right now, too many properties in CA have negative cash flow.  I don't like gambling, I only like to make bets I can win.